Loss of stock of goods purchased during the fy 2016-17

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TARIQUE RIZVI (Querist)
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26 August 2017 How we will we pass the entry of the loss on account of damaged goods If damaged goods is found in our ready stock during the fy 2016-17 ? What will be effect on Gross Profit and Net Profit also ? Will Net Profit increase ? or will net profit decrease ?

sivaram

sivaram (Expert)
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26 August 2017 debit loss of stock due to damage and credit stock since valued at a price less than good stock your GP Ratio reduces so also net profit on account of this transaction alone